Job Work, Anti Profiteering and Other Misc. Provisions under CGST Act, 2017

1. INTRODUCTION

1.1 Chapter XXI of the CGST Act, 2017 and Chapter IX of the IGST Act, 2017 contain the miscellaneous provisions, covering various Sections of CGST Act. State GST laws also prescribe identical miscellaneous provisions.

1.2 The following are the provisions of CGST Act, 2017 covered in this Chapter:

Sr. No.	Section/Rules	Provisions pertaining to
1	Section 143	Job work procedure
2	Section 144	Presumption as to documents in certain cases
3	Section 145	Admissibility of micro films, facsimile copies of documents and computer print-outs as documents and as evidence
4	Section 146	Common portal
5	Section 147	Deemed exports
6	Section 148	Special procedure for certain processes
7	Section 149	Goods and services tax compliance rating
8	Section 150	Obligation to furnish information return
9	Section 151	Power to collect statistics
10	Section 152	Bar on disclosure of information
11	Section 153	Taking assistance from an expert
12	Section 154	Power to take samples
13	Section 155	Burden of proof
14	Section 156	Persons deemed to be public servants
15	Section 157	Protection of action taken under this Act
16	Section 158	Disclosure of information by a public servant
17	Section 158A	Consent based sharing of information furnished by taxable person
18	Section 159	Publication of information in respect of persons in certain cases
19	Section 160	Assessment proceedings, etc., not to be invalid on certain grounds
20	Section 161	Rectification of errors apparent on the face of record
21	Section 162	Bar on jurisdiction of civil courts
22	Section 163	Levy of fee
23	Section 164	Power of Government to make rules
24	Section 165	Power to make regulations
25	Section 166	Laying of rules, regulations and notifications
26	Section 167	Delegation of powers
27	Section 168	Power to issue instructions or directions
28	Section 168 A	Power of Government to extend time limit in special circumtances
29	Section 169	Service of notice in certain circumstances
30	Section 170	Rounding off of tax, etc.
31	Section 171	Anti-profiteering measure
32	Rule 123	Constitution of the Standing Committee and Screening Committees
33	Rule 126	Power to determine the methodology and procedure
34	Rule 127	Functions of the Authority
35	Rule 128	Examination of application by the Standing Committee and Screening Committee
36	Rule 129	Initiation and conduct of proceedings
37	Rule 130	Confidentiality of information
38	Rule 131	Cooperation with other agencies or statutory authorities
39	Rule 132	Power to summon persons to give evidence and produce documents
40	Rule 133	Order of the Authority
41	Rule 135	Compliance by the registered person
42	Rule 136	Monitoring of the order
43	Section 172	Removal of difficulties
44	Section 173	Amendment of Act 32 of 1994
45	Section 174	Repeal and saving

1.3. The following provisions of the IGST Act, 2017 have been covered in this chapter –

Sr. No.	Section / Rules	Provision pertaining to
1	Section 17	Apportionments of tax and settlement of funds
2	Section 18	Transfer of input tax credit
3	Section 19	Tax wrongfully collected and paid to Central Government or State Government
4	Section 20	Application of provisions of Central Goods and Services tax Act
5	Section 21	Import of services made on or after the appointed day
6	Section 22	Power to make rules
7	Section 23	Power to make regulations
8	Section 24	Laying of rules, regulations and notifications
9	Section 25	Power to issue instructions or directions
10	Section 26	Removal of difficulties

2. JOB WORK UNDER GST

2.1 Job-work sector constitutes a significant industry in Indian economy. It includes outsourced activities that may or may not culminate into manufacture of finished goods.

2.2 Job-work means processing of goods supplied by the principal supplier. The principal supplier can send inputs or semi-finished goods to a job worker for further processing.

2.3 Many facilities, procedural concessions have been given to the job workers as well as the principal supplier who sends goods for job work. The whole idea is to make principal supplier responsible for meeting compliances on behalf of the job-worker on the goods processed by him (job-worker), considering the fact that typically the job workers are small persons who are unable to comply with the discrete provisions of the law.

2.4 The CGST Act, 2017 makes special provisions with regard to removal of goods for job-work and receiving back the goods after processing from the job-worker without payment of GST. The benefit of these provisions shall be available both to the principal supplier and the job-worker.

2.5 Section 2(68) of the CGST Act, 2017 defines job work as ‘any treatment or process undertaken by a person on goods belonging to another registered person’. (Section 2(68) of CGST Act, 2017)

2.6 The one who does the said job would be termed as ‘job worker’. The job-worker is required to carry out the process specified by the principal, on the goods.

2.7 The ownership of the goods does not transfer to the job-worker but it rests with the principal.

2.8 The GST law provides for certain facilities with certain conditions in relation to job work, some of which are as under:

(i) A registered person (Principal supplier) can send inputs/ capital goods under intimation and subject to certain conditions without payment of tax to a job worker and from there to another job worker and after completion of job work bring back such goods without payment of tax. The principal supplier is not required to reverse the ITC availed on inputs or capital goods dispatched to job-worker.

(ii) Principal supplier can send inputs or capital goods directly to the job worker without bringing them to his premises, still the principal supplier can avail the credit of tax paid on such inputs or capital goods.

(iii) The inputs and/ or capital goods sent to a job worker are required to be returned to the principal within 1 year and 3 years, respectively, from the date of sending such goods to the job worker.

(iv) After processing of goods, the job-worker may clear the goods to:

• Another job-worker for further processing;
• Dispatch the goods to any of the place of business of the principal supplier without payment of tax;
• Remove the goods on payment of tax within India or without payment of tax for export outside India on fulfilment of conditions.

2.9 The facility of supply of goods by principal supplier to the third party directly from the premises of the job-worker on payment of tax in India likewise with or without payment of tax for export may be availed by the principal supplier on declaring premises of the job-worker as his additional place of business in registration. In case the job-worker is a registered person under GST, even declaring the premises of the job worker as additional place of business is not required.

2.10 Before supply of goods to job-worker, principal supplier would be required to intimate the Jurisdictional Officer containing the details of description of inputs intended to be sent by the principal supplier and the nature of processing to be carried out by the job-worker. The said intimation shall also contain the details of another job-worker, if any.

2.11 The inputs or capital goods shall be sent to the job worker under the cover of a challan issued by the principal supplier. The challan shall be issued even for the inputs or capital goods sent directly to the job worker. The responsibility for keeping proper accounts for the inputs or capital goods shall lie with the principal supplier.

2.12 Availment of Input Tax Credit – Section 19 of the CGST Act, 2017 provides that the principal supplier (a person supplying taxable goods to the job worker) shall be entitled to take the credit of input tax paid on inputs sent to the job-worker for the job work. Further, the proviso also provides that the principal supplier can take the credit even when the goods have been directly supplied to the job-worker without bringing into the premise of the principal supplier. The principal supplier need not wait till the inputs are first brought to his place of business. (Section 19 of the CGST Act 2017)

2.13 Time Limits for return of processed goods – Section 19 of the CGST Act, 2017, stipulates that inputs and capital goods after processing shall be returned back to principal supplier within one year or three years respectively of their being sent out. Further, the provision of return of goods is not applicable in case of moulds and dies, jigs and fixtures or tools supplied by the principal supplier to job-worker.

2.14 As per the explanation provided in Section 143 of the CGST Act, 2017, where certain process is carried out on the input before removal of the same to the job worker, such product after carrying out the process to be referred as the intermediate product. Such intermediate product can also be removed without the payment of tax. Therefore, both input and intermediate product can be cleared without payment of duty to job-worker. (Section 143 of the CGST Act, 2017)

2.15 Waste clearing provisions – In terms of Section 143 (5) of the CGST Act, 2017, waste generated at the premises of the job-worker may be supplied directly by the registered job worker from his place of business on payment of tax or such waste may be cleared by the principal supplier, in case the job-worker is not registered. (Section 143(5) of CGST Act, 2017)

3. PRESUMPTION AS TO DOCUMENTS IN CERTAIN CASES [SECTION 144]

3.1 Presumption means an act of accepting that something is true until it is proved not true. Section 144 of the CGST Act, 2017 lays down presumptions that are taken cognizance of by the Court when certain documents, like documents produced by any person under the CGST Act, 2017 or under any other law, documents seized from the custody of any person under the CGST Act, 2017 or under any other law, documents received from any place outside India in the course of any proceedings, are submitted as evidence by the prosecution in a proceeding under the CGST Act, 2017 against any person. (Section 144 of CGST Act, 2017)

3.2 As per the Evidence Act, 1872, the contents of a document must be proved by evidence and signature or handwriting of a person on the document must be proved to be of the person of whom it is alleged to be.

3.3 A document which is required by law to be attested shall not be used as evidence until at least one attesting witness has been called for the purpose of proving its execution, except in certain cases.

3.4 Section 144 of the CGST Act, 2017 enables the court of law to make departure from the above general principles, in respect of the documents mentioned above given in the diagram above, and presume:

• truth of the contents of the document;
• that the signature which purports to be in the handwriting of any particular person is in that person’s handwriting;
• execution or attestation in the document has been made by the person by whom it purports to have been so executed or attested.

3.5 This implies that in case of such documents, if the said person claims that the document is not true or not signed or handwritten by him or not attested or executed by him, the burden of proof in respect of the same shall lie on him.

3.6 The Stamp Act, 1899 provides that a document which is not duly stamped shall be inadmissible in evidence.

However, section 144 allows the Court to depart from such general provision by providing that a document shall be admissible in evidence even if it is not duly stamped.

4. ADMISSIBILITY OF MICRO FILMS, FACSIMILE COPIES OF DOCUMENTS AND COMPUTER PRINTOUTS AS DOCUMENTS AND AS EVIDENCE [SECTION 145]

4.1 ‘Document’ has been defined in section 2(41) of the CGST Act, 2017 to include written or printed record of any sort and electronic record as defined in the Information Technology Act, 2000. (Section 2(41) of CGST Act, 2017)

4.2 Deemed documents- As per section 145(1) of the CGST Act, 2017, the following shall be deemed as ‘documents’: (Section 145(1) of CGST Act, 2017)

(i) A micro film of a document or the reproduction of the image(s) embodied in such micro film, whether enlarged or not – Microfilms are films containing microphotographs of a document. Such images are generally provided as negatives

(ii) A facsimile copy of a document – A facsimile is a copy or reproduction of a document that is as true to the original source as possible. An exact copy of a document is a facsimile.

(iii) A statement contained in a document and included in a printed material produced by a computer.

(iv) Information stored electronically in any device or media, including any hard copies made of such information – It refers to the information stored in digital form, which requires the use of computer hardware and software. Also, such information is normally created and altered in the digital form. This category would include the information stored in ERP systems that are employed by most businesses presently. It also includes printouts of such digital information.

4.3 Such documents shall be admissible in any proceedings under the Act, without further proof or production of the original, as evidence of any contents of the original or of any fact stated therein of which direct evidence would be admissible.

4.4 Certification – As per section 145(2) of the CGST Act, 2017, a certificate, – (Section 145(2) of CGST Act, 2017)

(a) identifying the document containing the statement and describing the manner in which it was produced;

(b) giving such particulars of any device involved in the production of that document as may be appropriate for the purpose of showing that the document was produced by a computer,

shall constitute evidence of any matter stated in the certificate.

4.5 A certificate shall be sufficient for a matter to be stated to the best of the knowledge and belief of the person stating it.

5. COMMON PORTAL [SECTION 146]

5.1 Section 146 of the CGST Act, 2017 enables the Government to notify the GST Common Portal on recommendation of the GST Council for facilitating the following: (Section 146 of CGST Act, 2017)

• Registration
• Payment of Tax
• Furnishing of returns
• Computation and settlement of integrated tax
• Electronic way bill
• Other functions and prescribed purposes

5.2 CBIC has notified www.gst.gov.in as the GST common portal to carry out the above stated functions. However, the Common GST Electronic Portal for furnishing electronic way bill is www.ewaybillgst.gov.in.

6. DEEMED EXPORTS [SECTION 147]

6.1 Section 147 of the CGST Act, 2017 lays down the provisions for deeming certain supplies as exports, so as to extend the benefit of export to such supplies. Supplies may be notified as deemed exports if they meet the following conditions: (Section 147 of the CGST Act, 2017)

• Goods supplied do not leave India.
• Payment for such supplies is received either in Indian rupees or in convertible foreign exchange.
• Such goods are manufactured in India.

6.2 It may be noted that this provision is applicable only in case of supply of goods, and not supply of services.

7. SPECIAL PROCEDURE FOR CERTAIN PROCESSES [SECTION 148]

7.1 Section 148 of the CGST Act, 2017 is an enabling provision for prescribing special procedures for certain processes. The following are noteworthy in this regard: (Section 148 of CGST Act, 2017)

• Such procedures shall be prescribed by way of a notification issued by the Government, on recommendations of the GST Council.
• The conditions and safeguards and the classes of registered persons to whom such procedures will be applicable shall be stated in the notification itself.
• The special procedures may be prescribed with regard to the following matters:
• Registration
• Filing of returns
• Payment of tax
• Administration

7.2 Some notifications issued by the Government under this section are:

• Notification No. 57/2017 CT dated 15.11.2017 seeks to prescribe quarterly furnishing of return in Form GSTR-1 for taxpayers having aggregate turnover of up to Rs. 1.5 crores.
• Notification No. 04/2018 CT (Rate) dated 25.01.2018 seeks to provide special procedure with respect to payment of tax by registered person supplying service by way of construction against transfer of development rights and vice versa.

8. GOODS AND SERVICES TAX COMPLIANCE RATING [SECTION 149]

As per section 149 of the CGST Act, 2017, every registered person shall be assigned a compliance rating based on the record of compliance in respect of specified parameters. Such ratings shall not be permanent and will be revised from time to time. The ratings shall be intimated to the taxable person and will also be placed in the public domain. A prospective client will be able to see the compliance ratings of suppliers and take a decision as to whether to deal with a particular supplier or not. This will create healthy competition amongst taxable persons. (Section 149 of CGST Act, 2017)

9. POWER TO COLLECT STATISTICS & BAR ON DISCLOSURE OF INFORMATION [SECTIONS 151 &152]

9.1 The provisions of Section 151 of CGST Act, 2017 lay down as under: (Section 151 and 152 of CGST Act, 2017)

(i) If the Commissioner considers necessary to do so, he may direct that statistics be collected relating to any matter dealt with, by or in connection with the Act.

(ii) The statistics can be collected only for the purpose of better administration of the Act.

(iii) Upon such notification being issued, the Commissioner, or any person authorized by the Commissioner in this behalf may call upon all concerned persons to furnish such information or returns as may be specified therein relating to any matter in respect of which statistics is to be collected.

9.2 Bar on disclosure of information [Section 152]-

(i) No information of any individual return with respect to any matter given for the purpose of sections 150 or 151 shall be published without the previous consent in writing of the concerned person or his authorised agent, to enable any particulars to be identified as referring to a particular person.

(ii) No such information shall be used for the purpose of any proceedings under the Act.

9.3 Confidentiality – Except for the purposes of prosecution under the CGST Act, 2017, or any other Act, no person who is not engaged in the collection of statistics under the Act or of compilation or computerization thereof for the purposes of the Act, shall be permitted to see or have access to any information or any individual return referred to in section 151.

9.4 Exception reporting – No restriction shall apply to the publication of any information relating to a class of dealers or class of transactions, if in the opinion of the Commissioner, it is desirable in the public interest, to publish such information.

10. TAKING ASSISTANCE FROM AN EXPERT [SECTION 153]

10.1 Section 153 of the CGST Act, 2017 enables an officer, not below the rank of Assistant commissioner, to take assistance of any expert at any stage of scrutiny, inquiry, investigation or any other proceedings before him. (Section 153 of CGST Act, 2017)

10.2 Such decision shall be taken having regard to the nature and complexity of the case and the interest of revenue.

10.3 Example – An IT professional’s assistance may be sought where the officer is of the view that information pertaining to a taxable person stored on a computer system does not reveal correct details.

11. POWER TO TAKE SAMPLES [SECTION 154]

Section 154 of the CGST Act, 2017 authorizes the Commissioner, or an officer authorized by him to take samples of goods from the possession of any taxable person, where he considers it necessary. Such officer shall provide a receipt for any samples so taken. (Section 154 of CGST Act, 2017)

12. BURDEN OF PROOF [SECTION 155]

‘Burden of proof’ normally refers to the obligation to prove one’s assertion. Section 155 of the CGST Act, 2017 lays down that where any person claims that he is eligible for input tax credit under this Act, the burden of proving such claim shall lie on such person. Thus, where a presumption is raised that a person is not eligible for input tax credit then the onus shall be on such person to rebut the same. (Section 155 of CGST Act, 2017)

13. PERSONS DEEMED TO BE PUBLIC SERVANTS [SECTION 156]

Section 156 of the CGST Act, 2017 deems all persons discharging functions under the Act as public servants within the meaning of Section 21 of the Indian Penal Code, 1860. This means that such persons shall qualify as public servants for the purpose of Indian Penal Code, wherever applicable. (Section 156 of CGST Act, 2017)

14. PROTECTION OF ACTION TAKEN UNDER THIS ACT [SECTION 157]

14.1 Section 157 of the CGST Act, 2017 grants immunity to the following persons against legal proceedings for anything done or intended to be done in good faith: (Section 157 of CGST Act, 2017)

• President of the Appellate Tribunal
• State President of the Appellate Tribunal
• Members of the Appellate Tribunal
• Officers or other employees of the Appellate Tribunal
• Any other person authorised by the Appellate Tribunal
• Any officer appointed or authorised under the Act

14.2 It provides immunity from personal liability for decisions, acts, or omissions that are made within the scope of their official duties, and not made in a wanton or reckless manner.

15. DISCLOSURE OF INFORMATION BY A PUBLIC SERVANT [SECTION 158]

15.1 Section 158 of the CGST Act, 2017 lays down the provisions for disclosure of information by a public servant as also maintaining the confidentiality of the same and related penal provisions in the event of contravention of the same. (Section 158 of CGST Act, 2017)

15.2 The following shall be treated as confidential:

(i) All particulars contained in any statement made, return furnished or accounts or documents produced in accordance with the Act; or

(ii) All particulars contained in any record of evidence given in the course of any proceedings under the Act (other than proceeding before a Criminal Court); or

(iii) All particulars contained in any record of any proceedings under the Act.

15.3. Section 158(3) of the CGST Act, 2017 provides that the following information may be disclosed: (Section 158(3) of CGST Act, 2017)

(i) For prosecution: Any particulars in respect of any such statement, return, accounts, documents, evidence, affidavit or deposition, for the purpose of any prosecution under the Indian Penal Code or the Prevention of Corruption Act, 1988, or the Act, or any other law for the time being in force; or

(ii) For carrying out the objects of the Act: Any particulars to the Central Government or the State Government or to any person acting in the implementation of the Act, for the purpose of carrying out the object of the Act; or

(iii) For service of notice or recovery of demand: Any particulars when such disclosure is occasioned by the lawful exercise under the Act of any process for the service of any notice or the recovery of any demand; or

(iv) For furnishing information to Court in a proceeding where Government is a party: Any particulars to a Civil Court in any suit or proceeding, to which the Government or any authority under the Act is a party, which relates to any matter arising out of any proceeding under the Act or under any other law for the time being in force authorising any such authority to exercise any powers thereunder; or

(v) For audit of tax receipts or refunds: Any particulars to any officer appointed for the purpose of audit of tax receipts or refunds of the tax imposed by the Act; or

(vi) For inquiry into the conduct of GST officer: Any particulars where such particulars are relevant for the purposes of any inquiry into the conduct of any GST officer, to any person or persons appointed as an inquiry officer under any relevant law; or

(vii) For enabling levy/realisation of any tax or duty: Any such particulars to an officer of the Central Government/ by a public servant/ statutory authority/ State Government, as may be necessary for the purpose of enabling that Government to levy or realise any tax or duty; or

(viii) By lawful exercise of powers: Any particulars, when such disclosure is occasioned by the lawful exercise by a public servant or any other statutory authority, of his or its powers under any law for the time being in force; or

(ix) For inquiry into a charge of misconduct by any professional: Any particulars relevant to any inquiry into a charge of misconduct in connection with any proceedings under the Act against a practising advocate, a tax practitioner, a practising cost accountant, a practising chartered accountant, a practising company secretary to the authority empowered to take disciplinary action against the members practising the profession of a legal practitioner, a cost accountant, a chartered accountant or a company secretary, as the case may be; or

(x) For data entry on automated system: Any particulars to any agency appointed for the purposes of data entry on any automated system or for the purpose of operating, upgrading or maintaining any automated system where such agency is contractually bound not to use or disclose such particulars except for the aforesaid purposes; or

(xi) For any other law: Any particulars to an officer of the Government as may be necessary for the purposes of any other law in force in India; and

(xii) In public interest: Any information relating to any class of taxpayers or class of transactions for publication, if, in the opinion of the Commissioner, it is desirable in the public interest, to publish such information.

15.4 Section 158(2) of the CGST Act, 2017 overrides the provisions contained in the Indian Evidence Act, 1872. It states that Court shall not require any GST officer to produce before it or to give evidence before it in respect of the particulars like statement made, return furnished or accounts or documents produced referred to in section 158(1). However, this restriction will not apply in respect of disclosures mentioned under sub-section (3). (Section 158 of CGST Act, 2017)

16. PUBLICATION OF INFORMATION IN RESPECT OF PERSONS IN CERTAIN CASES [SECTION 159]

Section 159 of the CGST Act, 2017 confers powers on the Commissioner for publishing names and other particulars of persons in certain cases. The details are as mentioned in the Table below- (Section 159 of CGST Act, 2017)

What type of information can be published?	The name of any person and any other particulars relating to any proceedings or prosecutions under the Act in respect of such person.
Who can publish such information?	Commissioner, or any other officer authorised by him in this behalf.
What is the manner    of publication of information?	The information shall be published in such manner as the Commissioner/ authorised officer thinks fit.
When can the information be published?	Such information shall be published if Commissioner/any other officer autho-rised by him in this behalf is of the opinion that it is necessary/expedient in public interest to do so.
Is there any additional in- formation which can be published?	In cases of firm, company or association of persons, names of the partners of the firm, directors, managing agents, secretaries and treasurers or managers of the company, or the members of the association, as the case may be may also be published, if in the opinion of the Commissioner/authorised officer, circumstances of the case justify it.
What is the limitation on publication of information relating to penalty?	No publication under this section shall be made in relation to any penalty imposed under the Act: until the time for presenting an appeal to the Appellate Authority under section 107 has expired (three months extendable to further one month) without an ap-peal having been presented; or the appeal, if presented, has been disposed of.

17. ASSESSMENT PROCEEDINGS, ETC. NOT TO BE INVALID ON CERTAIN GROUNDS [SECTION160]

17.1 Sometimes, proceedings are challenged for their validity merely for reasons of mistakes. This provision aims at saving the proceedings from such challenges.

17.2 The following proceedings done, accepted, made, issued, initiated, or purported to have been done, accepted, made, issued, initiated in pursuance of any provisions of the Act are covered under the provisions of Section 160 of the CGST Act, 2017 and such proceedings shall not be held invalid for mere reason of mistake, defect or omission, if such proceedings are in substance and effect in conformity with or according to the intents, purposes and requirements of the Act or any earlier law – (Section 160 of CGST Act, 2017)

• Assessment
• Re-assessment
• Adjudication
• Review
• Revision
• Appeal
• Rectification
• Notice
• Summons
• Other proceedings

17.3 The service of any Notice, Order or Communication shall not be called in question if the notice, order or communication has already been acted upon by the person to whom it is issued or where such service has not been called in question at or in the earliest proceedings commenced, continued or finalised pursuant to such notice, communication or order.

18. RECTIFICATION OF ERRORS APPARENT ON THE FACE OF RECORD [SECTION 161]

18.1 Section 161 of the CGST Act, 2017 provides for rectification of mistakes/errors apparent on the face of record by any authority. This section overrides the entire Act, except for the provisions of section 160 discussed above. (Section 160 of CGST Act, 2017)

18.2 The documents covered under Section 161 are decision, order, any notice, Certificate or any other document.

18.3 Any authority who has passed or issued any decision or order or notice or certificate or any other document may rectify any error, which is apparent on the face of record in such documents. Rectification can only be of error apparent from record. A decision on a debatable point of law is not a mistake apparent from the record.

18.4 The authority may rectify the mistake/error suo moto, when such error or mistake is brought to its notice by a GST officer or when such error or mistake is brought to notice by the affected person within a period of 3 months from the date of issue of such decision or order or notice or certificate or any other document, as the case may be.

18.5 No rectification can be made after a period of six months from the date of issue of such decision/order/notice/ certificate/any other document. However, such time limit does not apply in cases where the rectification is purely in the nature of correction of a clerical or arithmetical error or mistake, arising from any accidental slip or omission.

18.6 Principles of natural justice should be followed by the authority carrying out such rectification, if such rectification adversely affects any person.

19. BAR ON JURISDICTION OF CIVIL COURTS [SECTION 162]

19.1 Taxes are a civil liability. The basic rule is that every dispute which is civil in nature can be tried by the Civil Court. However, since tax laws generally provide a specific machinery for assessment, appeals and recovery etc., in terms of a special legislation, the jurisdiction of Civil Courts is barred in matters relating to tax laws.

19.2 Therefore, as per Section 162 of the CGST Act, 2017, no Civil Court shall have jurisdiction to deal with or decide any question arising from or relating to anything done or purported to be done under the Act. However, this bar does not apply in case of appeals to High Court and Supreme Court as provided under Sections 117 and 118 of the CGST Act, 2017, respectively. (Section 162, 117 and 118 of CGST Act, 2017)

20. LEVY OF FEE [SECTION 163]

Section 163 of the CGST Act, 2017, provides that a copy of any order or document can be provided to any person on an application made by him for that purpose after paying a prescribed fee. (Section 163 of CGST Act, 2017 POWER OF GOVERNMENT TO MAKE RULES & REGULATIONS [SECTIONS 164 & 165] (Section 163 of CGST Act, 2017)

21. POWER OF GOVERNMENT TO MAKE RULES & REGULATIONS [SECTIONS 164 & 165]

21.1 Section 164 empowers the Government to make rules on the recommendations of the GST Council for carrying out the provisions of the Act. (Section 164 and 165 of CGST Act, 2017)

21.2 The following are noteworthy in this regard:

• The Government may make rules for all or any of the matters which by the Act are required to be, or may be, prescribed or in respect of which provisions are to be or may be made by rules.
• The rules may also be issued with retrospective effect but not from a date earlier than the date on which the provisions of the Act have come into force.
• The rules may provide for a penalty not exceeding Rs.10,000/- for committing breach of any rule.

21.3 Section 165 empowers the Board to make regulations consistent with the Act and the rules made thereunder to carry out the provisions of the Act.

21.4 Thus, while the rule making power lies with the Government, the regulation making power has been delegated to the CBIC (Board).

21.5 The Central Government and the Board have been vested with the similar powers of making rules and regulations respectively under sections 22 & 23 of the IGST Act, 2017 also.

22. LAYING OF RULES, REGULATIONS AND NOTIFICATIONS [SECTION 166]

22.1 Section 166 of the CGST Act, 2017 provides that the following delegated legislation under the Act shall be laid before each house of the Parliament, while it is in session, for a total period of 30 days which may be comprised in one session, or in two or more successive sessions: (Section 166 of CGST Act, 2017)

• every rule made by the Government;
• every regulation made by the Board;
• every notification issued by the Government.

22.2 If both the Houses agree that any modification be made in the rule/ regulation/ notification or rule or regulation or notification should not be made, then the rule or regulation or notification shall thereafter have effect only in such modified form or be of no effect, as the case may be. However, any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule or regulation or notification.

22.3 Similar provisions relating to laying of rules, regulations and notification etc. have also been prescribed under Section 24 of the IGST Act, 2017. (Section 24 of IGST Act, 2017)

23. DELEGATION OF POWERS [SECTION 167]

Section 167 of the CGST Act, 2017, prescribes that the powers conferred on any authority/officer can also be exercised by another authority/officer, if the Commissioner so directs by way of notification, subject to such conditions as may be specified in the notification. (Section 167 of CGST Act, 2017)

24. POWER TO ISSUE INSTRUCTIONS OR DIRECTIONS [SECTION 168]

24.1 Section 168 of the CGST Act, 2017, empowers the Board (CBIC) to issue orders, instructions or directions to the CGST officers for the purpose of uniformity in the implementation of the Act. (Section 168 of CGST Act, 2017)

24.2 All officers and all other persons employed in the implementation of the Act observe and follow such orders, instructions or directions.

24.3 The binding nature of such orders, instructions and directions has been a matter of debate and scrutiny. The general understanding that prevails now is that a circular is binding on the officers, but not on the taxpayer.

However, in case such circular states something contrary to the law, the law shall prevail over the circular.

24.4 The meaning of Commissioner for the purposes of following provisions is Commissioner or Joint Secretary posted in the Board and such Commissioner or Joint Secretary shall exercise the powers specified in these said sections with the approval of the Board:

Section	Particulars
Section 2(91)	Meaning of ‘proper officer’
Section 5(3)	Delegation of powers by Commissioner
Section 25(9)(b)	Notification of person or class of persons for grant of Unique Identity Number
Section 35(3)	Notification of class of taxable persons required to maintain additional accounts or documents
Section 35(4)	Notification of class of taxable persons permitted to maintain accounts in a pre-scribed manner where the Commissioner considers that such persons are not in a position to keep and maintain accounts in accordance with the general provisions
Section 37(1)	Details of outward supplies (extension of time limit)
Section 38(2)	Details of inward supplies (extension of time limit)
Section 39(6)	Return (extension of time limit)
Section 44(1)	Annual return (extension of time limit)
Sub-sections (4) and (5) of section 52	Statement for tax collection at source and Annual Statement by Electronic Com-merce Operator (extension of time limit)
Section 143(1) except second proviso thereof	Job-work procedure (except extension of time limits of 1 year and 3 years)
Section 151(1)	Collection of statistics
Section 158(3)(l)	Exceptions to bar on disclosure of information by public servant
Section 167	Delegation of powers

25. POWER OF GOVERNMENT TO EXTEND TIME LIMIT IN SPECIAL CIRCUMSTANCES [SECTION 168A]

The Government is empowered to extend the time limits provided under the CGST Act, 2017 in respect of actions which cannot be completed or complied with due to force majeure. Here, force majeure means war, epidemic, flood, drought, fire, cyclone, earthquake or any other calamity caused by nature affecting the implementations of provisions of the CGST Act, 2017. This power can also be exercised retrospectively. (Section 168A of CGST Act, 2017)

26. MODES OF SERVICE OF NOTICE, DECISION, SUMMONS, ETC.

26.1 Any notice, decision, order, summons, or any other communication under the Act and the related rules are to be served on the taxpayer or the concerned person, in accordance with the provisions of Section 169 of the CGST Act, 2017. (Section 169 of CGST Act, 2017)

26.2 Sub-section (1) of Section 169 of the CGST Act, 2017 prescribes the following modes of service for notice, decision, order, summons, or any other communication:

• By giving or tendering it directly or by a messenger, including a courier to the addressee or the taxable person or to his manager or authorised representative or an advocate or a tax practitioner holding authority to appear in the proceedings on behalf of the taxable person or to a person regularly employed by him in connection with the business, or to any adult member of family residing with the taxable person; or
• By registered post or speed post or courier with acknowledgement due, to the person for whom it is intended or his authorised representative, if any, at his last known place of business or residence; or
• By sending a communication to his e-mail address provided at the time of registration or as amended from time to time; or
• By making it available on the common portal; or
• By publication in a newspaper circulating in the locality in which the taxable person or the person to whom it is issued is last known to have resided, carried on business or personally worked for gain; or
• If none of the modes aforesaid is practicable, by affixing it in some conspicuous place at his last known place of business or residence and if such mode is not practicable for any reason, then by affixing a copy thereof on the notice board of the office of the concerned officer or authority who or which passed such decision or order or issued such summons or notice.
• Every decision/order/summons/notice/communication shall be deemed to have been served on the date on which it is tendered or published or a copy thereof is affixed in the manner explained above.

26.4 When a decision, order, summons, notice or any communication is sent by registered post or speed post, it shall be deemed to have been received by the addressee at the expiry of the period normally taken by such post in transit unless the contrary is proved.

27. ROUNDING OFF OF TAX ETC. [SECTION 170]

27.1 The principle of rounding off laid out in Section 170 of the CGST Act, 2017 applies to tax, interest, penalty, fine, any other sum payable under the provisions of the Act, refund and any other sum due under the provisions of the Act. (Section 170 of CGST Act, 2017)

27.2 If the amount contains part of a rupee consisting of paise, and such part is fifty paise or more then increase to one rupee. Amount contains part of a rupee consisting of paise, and such part is less than fifty paise then such amount has to be ignored.

28. ANTI-PROFITEERING MEASURE [SECTION 171]

28.1 The burden of indirect taxation ultimately falls on the consumers. In GST regime there is an increased flow of input tax credit due to multiple stages involved in supplies. In such a scenario, the concern that benefit of such increased input tax credit may not be passed on by certain entities to the consumers is not justified.

28.2 Section 171 of CGST Act, 2017 makes it mandatory that any reduction in rate of tax on any supply of goods or services or the benefit of input tax credit shall be passed on to the recipient by way of commensurate reduction in prices. (Section 171 of CGST Act, 2017)

28.3 National Anti-profiteering Authority has been constituted by the Central Government to examine whether input tax credits availed by any registered person or the reduction in the tax rate have actually resulted in a commensurate reduction in the price of the goods and/or services supplied by him.

28.4 The duty of the National Anti-profiteering Authority shall be :

• to determine whether the reduction in tax rate or the benefit of input tax credit has been passed on by the seller to the buyer (hereinafter collectively referred to as ‘benefit’) by reducing the prices;
• to identify the taxpayer who has not passed on the benefit;
• to order-
  • reduction in prices;
  • return to the recipient, an amount equivalent to the amount not passed on by way of commensurate reduction in prices along with interest @ 18% from the date of collection of the higher amount till the date of the return of such amount or recovery of the amount not returned, as the case may be, in case the eligible person does not claim return of the amount or is not identifiable, and depositing the same in the Consumer Welfare Fund;
  • imposition of penalty;
  • cancellation of registration;
  • to furnish a performance report to the GST Council every quarter.

28.5 All applications from interested parties on issues of local nature or those forwarded by Standing Committee shall first be examined by the State Level Screening Committee. On being satisfied that the supplier has not passed on the benefit, the Screening Committee within 2 months from the date of receipt of a written application, further extendable up to one month for reasons to be recorded in writing as may be allowed by the Authority, will forward the application with its recommendations to the Standing Committee on Anti-profiteering.

28.6 If the Standing Committee is satisfied that there is a prima facie evidence to show that the supplier has not passed on the benefit, it shall refer the matter to the Director General of Anti-Profiteering (DGAP) for a detailed investigation within 2 months from the date of receipt of a written application (further extendable up to 1 month for reasons to be recorded in writing as may be allowed by the Authority).

28.7 The Directorate General of Anti Profiteering (DGAP) shall conduct investigation and collect evidence necessary to determine undue profiteering and before initiation of the investigation, issue a notice to the interested parties and to such other persons as deemed fit for a fair enquiry into the matter.

28.8 The evidence or information presented to the DGAP by one interested party can be made available to the other interested parties, participating in the proceedings. The evidence provided will be kept confidential and the provisions of Section 11 of the Right to Information Act, 2005, shall apply mutatis mutandis to the disclosure of any information which is provided on a confidential basis.

28.9 The DGAP can seek opinion of any other agency or statutory authorities in the discharge of his duties. The Authority, DGAP, or an officer authorised by him will have the power to summon any person either to give evidence or to produce a document or any other thing. He will also have same powers as that of a Civil Court and every such inquiry will be deemed to be a judicial proceeding.

28.10 The DGAP will complete the investigation within a period of 6 months or within such extended period not exceeding a further period of 3 months for reasons to be recorded in writing as allowed by the Authority. Upon completion of the investigation, the DGAP will furnish to the Authority, a report of its findings along with the relevant records.

28.11 If the Authority finds that a registered person has not passed on the benefit, the Authority may order:

• reduction in prices;
• return to the recipient, an amount equivalent to the amount not passed on by way of commensurate reduction in prices along with interest @ 18% from the date of collection of the higher amount till the date of the return of such amount or recovery of the amount including interest not returned, as the case may be;
• deposit an amount equivalent to 50% of the amount determined under the above clause along with interest @ 18% from the date of collection of the higher amount till the date of deposit of such amount in the Consumer Welfare Fund of Centre and the remaining 50% of the amount in the Consumer Welfare Fund of the concerned State, where the eligible person does not claim return of the amount or is not identifiable;
• imposition of penalty as specified under the Act; and
• cancellation of registration under the Act.

28.12 If the report of the DGAP recommends that there is contravention or even non-contravention of the provisions of Section 171 of the CGST Act, 2017 or these rules, but the Authority is of the opinion that further investigation or inquiry is called for in the matter, it may, for reasons to be recorded in writing, refer the matter to the DGAP to cause further investigation or inquiry in accordance with the provisions of the Act and these rules.

28.13 Upon receipt of the report of the DGAP, the Authority has reasons to believe that there has been contravention of the provisions of Section 171 of the CGST Act, 2017, in respect of goods and/or services other than those covered in the said report, it may, for reasons to be recorded in writing, within a period of six months, direct the DGAP to cause investigation or inquiry with regard to such other goods and/or services. Such investigation or enquiry shall be deemed to be a new investigation or enquiry and all the provisions of Rule 129 of the CGST Rules, 2017, shall mutatis mutandis apply to such investigation or enquiry.

28.14 The following points are relevant in this regard:

• Any order passed by the Authority shall be immediately complied with by the registered person failing which action shall be initiated to recover the amount.
• The Authority will pass order within 6 months from the date of the receipt of the report from the DGAP.
• An opportunity of being heard will be given, if the interested parties request for it in writing.
• Authority can now seek a clarification from DGAP on the Investigation report submitted by it during the process of determining as to whether the benefit has been passed on to the recipient by way of commensurate reduction in prices.
• Period of interest will be calculated from the date of collection of higher amount till the date of return of such amount.
• If the eligible person (i.e. the buyer) does not claim the return of the amount or the person is unidentifiable then the amount must be deposited to the Consumer Welfare Fund along with applicable interest.
• A registered person who is found to have profiteered is liable to pay a penalty of 10% of such profiteered amount if the profiteered amount is not deposited within 30 days of the date of passing of the order by the Authority.

28.15 Central Government, vide Notification No. 23/2022-CT dt. 23.11.2022 has empowered the Competition Commission of India (CCI) established under Section 7(1) of the Competition Act, 2002, to handle Anti-Profiteering cases and examine whether input tax credits availed by any registered person or the reduction in the tax rate have actually resulted in a commensurate reduction in the price of the goods or services or both supplied by him.

29. REMOVAL OF DIFFICULTIES [SECTION 172]

29.1 Section 172 of the CGST Act, 2017 lays down the procedure to be followed by the Government in case of any difficulty in giving effect to any provision of the Act. In such cases, the Central Government may, on the recommendations of the GST Council, by general or special order published in the Gazette, make such provisions not inconsistent with the provisions of the Act or the rules or regulations made thereunder, as may be necessary or expedient for the purpose of removing the said difficulty. (Section 172 of CGST Act, 2017)

29.2 The time limit for making such order shall be 5 years from the date of commencement of the Act. 29.3 Every order so made shall be laid, as soon as may be, after it is made, before the Parliament.

29.4 Similar provisions relating to removal of difficulty have also been prescribed under section 25 of the IGST Act, 2017. (Section 25 of IGST Act, 2017)

30. OMISSION AND REPEAL OF EARLIER LAWS [SECTIONS 173 AND 174]

30.1 Amendment of Act 32 of 1994 [Section 173 of CGST Act, 2017] – Chapter V of the Finance Act, 1994 laid down the provisions for Service Tax. Since Service Tax has been subsumed in GST, such provisions are no more required and hence have been omitted and are not in force. (Section 173 and 174 of CGST Act, 2017)

30.2 Repeal and saving [Section 174 of the CGST Act, 2017] – The following legislations stand repealed from July 1, 2017, i.e. the date of commencement of the CGST Act, 2017:

• The Central Excise Act, 1944 (except in respect of goods included in Entry 84 of Union List – petroleum crude, high speed diesel, motor spirit, natural gas, aviation turbine fuel, tobacco and tobacco products)
• The Medicinal and Toilet Preparations (Excise Duties) Act, 1955
• The Additional Duties of Excise (Goods of Special Importance) Act, 1957
• The Additional Duties of Excise (Textiles and Textile Articles) Act, 1978
• The Central Excise Tariff Act, 1985

30.3 The repeal under Section 174 of the CGST Act, 2017 or amendment under section 173 ibid shall not:

• revive anything not in force or existing at the time of such amendment or repeal – No new effect.
• affect the previous operation of the amended Act or repealed Acts and orders or anything duly done or suffered thereunder – No effect on previous position.
• affect any right, privilege, obligation, or liability acquired, accrued or incurred under the previous law – No effect on rights or liabilities under previous law. Any tax exemption granted as an incentive against investment through a notification shall not continue as privilege if the said notification is rescinded on or after the appointed day.
• affect any duty, tax surcharge, fine, penalty, interest as are due or may become due or any forfeiture or punishment incurred or inflicted in respect of any offence or violation committed against the provisions of the previous law – No effect on tax etc. due under previous law.
• affect any investigation inquiry, verification, adjudication and assessment proceedings, recovery proceedings, other legal proceedings or tax, penalty etc. and any such proceedings that may be instituted, continued or enforced and tax, penalty etc. that may be levied or imposed as if these Acts had not been so amended or repealed – No effect on legal proceedings and tax, penalty etc. under previous law.
• affect any proceedings, including that relating to an appeal, review or reference, instituted before, on or after the appointed day under the previous law – No effect on any appellate proceeding under previous law.
• The provisions of Section 6 of the General Clauses Act, 1897 with regard to the effect of repeal will apply for repeal provided under Section 174 of the CGST Act, 2017.

31. APPLICATION OF PROVISIONS OF CENTRAL GOODS AND SERVICES TAX ACT [SECTION 20 OF THE IGST ACT, 2017] (Section 20 of IGST Act, 2017)

31.1 The following provisions of CGST Act, 2017 apply to IGST Act, 2017 also:

• scope of supply
• composite supply and mixed supply
• time and value of supply
• input tax credit
• registration
• tax invoice, credit and debit notes
• accounts and records
• returns, other than late fee
• payment of tax
• tax deduction at source [TDS rate under IGST – 2%]
• collection of tax at source [TCS rate under IGST – not exceeding 2%]
• assessment
• refunds
• audit
• inspection, search, seizure and arrest
• demands and recovery
• liability to pay in certain cases
• advance ruling
• appeals and revision
• presumption as to documents
• offences and penalties
• job work
• electronic commerce
• transitional provisions
• miscellaneous provisions including the provisions relating to the imposition of interest and penalty

31.2 When the tax involved is IGST, the rate of TDS shall be 2% and the rate of TCS shall not exceed 2%. Presently, the notified rate for TCS in case of IGST is 1%.

31.3 Where the penalty is leviable under the CGST Act, 2017 and the SGST/UTGST Act, 2017, the penalty leviable under the IGST Act, 2017 shall be the sum total of the said penalties.

31.4 The words and expressions used and not defined in the IGST Act, 2017 but defined in the CGST Act, 2017 shall have the same meaning as assigned to them in the said Act. Similarly, the words and expressions used and not defined in the CGST Act, 2017 but defined in the IGST Act, 2017 shall have the same meaning as assigned to them in the said Act.

32. APPORTIONMENT OF TAX AND SETTLEMENT OF FUNDS [CHAPTER VIII OF THE IGST ACT, 2017]

32.1 Since Central Tax (CGST) and State Tax (SGST) are separate taxes levied concurrently on a transaction, the same are identifiable and can be transferred to the CGST account and SGST account of the concerned State Governments, respectively. However, this is not possible in case of Integrated tax (IGST). Therefore, it becomes necessary to apportion IGST into components that can be transferred to CGST account and SGST account of the State Governments concerned.

32.2 Section 17 of the IGST Act, 2017 prescribes the provisions for such apportionment of IGST and settlement of funds between the Central Government and the State Governments. (Section 17 of IGST Act, 2017)

32.3 Section 17(1) of IGST Act, 2017 lays down that in respect of the IGST paid on the following supplies of goods and/or services, the IGST shall be apportioned:

• inter-State supply to an unregistered person or to a registered person paying tax under composition scheme;
• inter-State supply where the registered person is not eligible for input tax credit;
• inter-State supply made in a financial year to a registered person, where he does not avail of the input tax credit within the specified period and thus the tax remains in the integrated tax account after expiry of the due date for furnishing of annual return for such year in which the supply was made;
• import by an unregistered person or by a registered person paying tax under composition scheme;
• import where the registered person is not eligible for input tax credit;
• import made in a financial year by a registered person, where he does not avail of the said credit within the specified period and thus the tax remains in the integrated tax account after expiry of the due date for furnishing of annual return for such year in which the supply was received.

32.4 The IGST paid on the supplies mentioned above shall be apportioned as under:

• The amount of tax calculated at the rate equivalent to the CGST on similar intra-State supply shall be apportioned to the Central Government.
• The balance amount of IGST remaining in the integrated tax account shall be apportioned to the State where such supply takes place and to the Central Government if such supply takes place in a Union territory.
• If the place of such supply made by any taxable person cannot be determined separately, the balance amount shall be apportioned to each of the States/Central Government (in relation to Union territories) in proportion to the total supplies made by such taxable person to each of such States/Union territories in a financial year.
• If the taxable person making such supplies is not identifiable, the said balance amount shall be apportioned to all States and the Central Government in proportion to the amount collected as SGST/UTGST by the respective State/ the Central Government during the immediately preceding financial year.

32.5 In terms of Section 17(3) of the IGST Act, 2017, the interest, penalty and compounding amount realised in connection with the IGST shall also be apportioned in the similar manner.

32.6 Section 17(4) of the CGST Act, 2017, provides that the Central Government shall transfer the amount apportioned to it to the CGST account or UTGST account, as the case may be, and the amount apportioned to the State Government(s) to the SGST account of the respective States.

32.7 As per Section 17(2A) of the IGST Act, 2017, the amount of IGST in respect of B2B supplies wherein ITC is taken by the recipients may, for the time being, on the recommendations of the GST Council, be apportioned at the rate of 50% to the Central Government and 50% to the State Governments/Union territories on ad hoc basis. Such amount shall be adjusted against the amount apportioned under sub-sections (2) and (3). IGST apportioned to a State/Central Government on account of a Union territory, if subsequently found to be refundable to any person and refunded to such person, shall be reduced from the amount to be apportioned under this section, to such State/ Central Government on account of such Union territory.

32.8 Section 18 of the IGST Act,2017 provides as under: (Section 18 of IGST Act, 2017)

• When IGST credit is utilised for payment of CGST, the amount collected as IGST shall stand reduced by the amount equal to such credit. The Central Government shall transfer an amount equal to the amount so reduced from the IGST account to the CGST account.
• When IGST credit is utilised for payment of UTGST, the amount collected as IGST shall stand reduced by the amount equal to such credit. The Central Government shall transfer an amount equal to the amount so reduced from the IGST account to the UTGST account.
• When IGST credit is utilised for payment of SGST, the amount collected as IGST shall stand reduced by the amount equal to such credit and shall be apportioned to the appropriate State Government. The Central Government shall transfer the amount so apportioned to the account of the appropriate State Government.
• Appropriate State means the State or Union territory where a taxable person is registered or is liable to be registered under CGST Act, 2017.

32.9 Section 19 of the IGST Act, 2017, provides that a registered person who has paid IGST on a supply considered by him to be an inter-State supply, but which is subsequently held to be an intra-State supply, shall be granted refund of the amount of IGST so paid. A registered person who has paid CGST and SGST/UTGST on a transaction considered by him to be an intra-State supply, but which is subsequently held to be an inter-State supply, shall not be required to pay any interest on the amount of IGST payable. (Section 19 of IGST Act, 2017).

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Source: Handbook of GST Law and Procedures for Departmental Officers issued by Ministry of Finance